A leather and fur factory was launched in Semey
On June 3, 2020, the Investment Fund of Kazakhstan JSC and Semey Tannery LLP, which is part of the Kusto Group international group of companies, signed a property lease agreement with the right of subsequent purchase of the tannery in Semey.
The plant is of interest to the domestic investor as part of the general strategy for the development of livestock projects in Kazakhstan and will become a consumer of by-products of the agricultural industry – cattle skins.
The investor prepared the territory and equipment of the plant for launch in 2 months. The plant was launched in its main activity: the processing of cattle skins, the production, and sale of leather products – an export-oriented semi-finished chrome-tanned wet blue product.
“Now more than 60 people work at the plant, technical specialists who previously worked here and specialists from the local slate plant are involved. The number of personnel will increase as the plant’s capacities are loaded, we plan to recruit up to 200 people. In June-July, we carried out all the necessary work: cleaning the sewerage system, guarding the facility, checking the performance of the equipment. So, somewhere a partial repair was needed, the roof was restored, the premises for unassignments, showers were made for the workers. As of today, a batch of raw materials has been received, we have carried out commissioning work, and have released an experimental batch of more than 3000 sq. m. of the finished product – semi-finished product wet blue, ”said Ruslan Bisenov, Executive Director of Semey Tannery LLP.
The production of semi-finished chrome-tanned high-quality wet blue leather is a labor-intensive three-phase tanning process that requires specialized knowledge. These products, in addition to high quality, are distinguished by their durability, acceptable cost and, accordingly, the low price of the material.
This semi-finished product can be used for the production of jackets, shoes, accessories – all kinds of covers, belts.
The maximum capacity of the plant can be up to 1.7 million square meters of semi-finished product wet blue per year. Raw materials and necessary chemicals used in the production technology are supplied by local suppliers and are also partially purchased from Russia.
Currently, IFC is working to transfer problem assets into a competitive environment with the aim of their further launch.
The tannery was transferred to the Fund’s asset portfolio as a problem project in 2014. In connection with the bankruptcy of the ex-owner of the plant, the Fund, in order to preserve the plant, was forced from November 2019 to transfer the property complex of the enterprise to the balance sheet and bear the costs of maintaining the asset until the investor was attracted.
For reference:
MGK Kusto Group – was founded by businessman E. Tatishev with partners in 2008. Kusto Group has experience in building businesses in various fields and operates in 10 countries. Key markets of the Kusto Group are agribusiness, oil, and gas, real estate, building materials.
In Kazakhstan, Kusto Group has invested in a large agricultural project Kazbeef – breeding cattle production, feedlots, meat processing.
Investment Fund of Kazakhstan JSC is a state development institution and management company in the field of restructuring and management of distressed assets. The fund is part of the structure of Baiterek NMH JSC.